Burglar Howard stole $105m, says Carr

The Premier, Bob Carr, has likened the Prime Minister to a "serial burglar", claiming the Howard Government has delivered a second financial blow to NSW - this time in the form of a $105 million cut to public hospital funding over the next five years.

The federal Health Minister, Tony Abbott, confirmed the cuts, saying they were the result of a revision of funding arrangements under the five-year Australian Health Care Agreement signed last August.

Mr Carr said the revelation came after a Commonwealth Grants Commission decision to cut $376 million a year in revenue from federal taxes, placing pressure on what is already forecast to be a particularly tight state budget.

Mr Carr said that the federal Department of Health and Ageing had advised NSW by letter that a wages index that was built into the five-year Australian Health Care Agreement would be revised down.

Mr Abbott said the wage index used in the funding formula had been revised because of changes in inflation and population movements in NSW.

He said Mr Carr would have been aware at the time he signed the agreement that there was a possibility such a revision would be made.

Mr Carr said the agreement had been signed by NSW under duress in August 2003 and

that the wage index did not reflect the actual wage and cost increases experienced by the states and territories in providing health care.

"John Howard is like a serial burglar who just keeps coming back and hitting the households of NSW," Mr Carr said.

"He keeps returning to the same house and filling his sack with our possessions and clearing out the window . . . This is a simple case of the Federal Government using a complicated, irrelevant formula to strip a further $105 million from NSW hospitals over the next five years."

He said wage rises in the state's health sector averaged 12.7 per cent in the past 14 months but the Federal Government worked on a formula that reduced the rate of payments to the states and territories for wages.

NSW hospitals were already being penalised by the federal funding shortfall of almost $300 million over five years, Mr Carr said.

He also accused Mr Abbott of a "gross act of hypocrisy" for granting approval last week for private health funds to raise fees by 7.58 per cent.